Asset Protection Advice

[xcesiv]

I currently have 2 IPs and looking to buy my PPOR. This should push me over the 1M Mark in Property so i will be very happy, but this also bring sup my other issue of Asset Protection

I would like to discuss the touchy questions of asset protection when it comes to having a GF.
Mainly the issues of Broken Relationships and who to secure the hard work i have put in for my future if things were to go bad.

Is there anyone i can talk to get advice.

At this time we dont live together, but the time might come in the near future.

 

[Ausprop]

but your net asset position won't change - so how do you become more vulnerable?

 

[xcesiv]

I keep hearing from bitter females about how they took there ex partner for half there assets. Thats what worries me.

 

[coastymike]

You need some good legal advice. I have also seen both parties (not just females) enjoy the fruits of anothers labour.

Firstly go to a lawyer and discuss binding financial agreements. Not something exciting to talk about with your partner but if you dont want to risk losing half your assets you had when you came into the relationship then sort it out now.

If your wealth is increasing exponentially then it may be worth considering offshore structures. Not for tax purposes but in a divorce it is much harder dealing with different jurisdictions. Those assets (including cash) held by an offshore company with an offshore charity holding the shares (maybe even bearer shares). Are they controlled by you ? Whose benefit are they for ? Now you are mixing in local and international jurisdictions. Makes things messy for the other party and horribly expensive.

Anyway offshore structuring is not relevant unless you have over $5m to protect in my view. The reason being the costs to establish and run can be over $20k or more.

All worth discussing with your lawyer.

Binding Financials are your first line of defense in a divorce. Given the divorce rate, dont listen to other people who say "oh that is unromantic", "but if you really loved her you wouldnt need a BFA" or the one I love "you are preparing for divorce from the beginning, you just need to trust and grow together". These things sounds great but in a divorce they quickly change to "I will get that guy/girl for every dollar I can get", "im going to make him/her pay for the years I felt I have wasted" and "for all the things I did for him/her and this is what it comes to well wait until he/she meets my lawyer"

 

[wylie]

I don't know if it is enough protection, but perhaps you need to discuss this potential problem with your girlfriend before you take that step to move in together.

If you both take legal advice and both sign a pre-nup noting what you each bring to the partnership, and agreeing that should the relationship break down, what you brought in is protected.

It may seem unromantic, but I imagine a break up is pretty unromantic anyway. I suppose it could make her question the relationship, but in my opinion, if that puts her off, she is not for you anyway. I am quite sure that the super-rich we read about are having their future wives sign pre-nups.

Does she have any assets? Is she in tune with the way you are travelling in your asset accumulation? Is she prepared to work with you to build up your assets.

The more I think about it, I think you should not live together until you are sure she is on the same page regarding your joint striving towards the type of life you both want to lead.

Of course, you could put what you already have into a trust, but that will cost you.

However unromantic it may seem, if I was in a situation where I was bringing assets to a relationship, I would be protecting them for my children and for myself, seeing that I have done the hard yards. I would not want to hand half to someone just because we moved in together for a couple of years.

 

[Perp]

I think you should not live together until you are sure she is on the same page regarding your joint striving towards the type of life you both want to lead.

Call me old-fashioned, but I don't think that you should live together until you're either married, or have made a "marriage-like life-long commitment" to each other (if you have a problem with the institution of marriage, or current laws unfortunately don't permit you to marry).

I also don't like the idea of BFAs/pre-nups, not because it's unromantic, but because I think that it encourages people to get into relationships that they're not 100% committed to or sure about. You shouldn't live together to "try it out", IMHO. Make a commitment to be together, or don't.

The relationship should be entered into with such commitment and such a passionate intention to make it life-long, that if you lost everything you own, it would be a trivial loss relative to the emotional pain of the relationship breakdown. Can that happen? Sure, it can. But at nowhere near the rate of relationship breakdown due to entering a relationship with insufficient commitment. (Which I firmly believe is the major cause of relationship breakdown.)

The main due diligence you have to do on your life partner is not whether you get along with their family, whether you have the same views towards money, etc, but whether they have the same commitment to making the relationship work. If you share a commitment to making it work, you can resolve almost any issue (addiction and domestic violence being two of the possible rare exceptions). If one or both of you feels that failure is an option, failure becomes likely. And getting a BFA is an overt acknowledgment that failure is an option.

But hey, I'm an admittedly and unashamedly "boots and all", "don't do things by halves", "burn your bridges" kind of gal.

Given the divorce rate, dont listen to other people who say "oh that is unromantic", "but if you really loved her you wouldnt need a BFA" or the one I love "you are preparing for divorce from the beginning, you just need to trust and grow together".

It doesn't matter what the statistics are; we're not passive victims, subject to the whims of fate. There are things that we can do to make divorce highly unlikely. Because there are two parties in a marriage, and you can't control the other person's actions, you can of course never 100% preclude the possibility of divorce, but neither do you have to think of marriage as a "roll of the dice".

 

[wylie]

Call me old-fashioned, but I don't think that you should live together until you're either married, or have made a "marriage-like life-long commitment" to each other ....

OK. You are old fashioned .

I don't disagree with your stance, but statistics just don't support the idea that people enter marriage "boots and all". And even if one party does, who knows what is really in the head of the other party.

I freely admit that I went into my marriage with a little voice in my head saying "if this doesn't work out, we will go our separate ways". It got me through the day, which I found really stressful. Whilst I loved my husband to be, I just didn't know how marriage would be.

I would have felt much more comfortable if we were not "forced" to do the bit white wedding bit. We should have put our collective foot down but, in our case, it was a day for my mother and his mother to show off. We both would have preferred a registry office marriage and a small dinner and as everything mounted to a crescendo, I was really having second thoughts about what we were doing. We didn't enjoy our wedding day too much to be honest.

Turns out our being "manacled together" has been pretty good. We are as happy now as we were back then, probably more so. It's tough some times, and we have to work at compromising and living with things that we might not each like about each other, but that is what commitment is all about.

Sometimes you just have to hold you nose and jump, but protect your assets first.

And, finally, I would never have moved in with my husband to be if we were both not committed to a life together. No "give it a try" living together for me.

 

[Nathan]

Just dont let her stay over for more then 2 nights per week.

Therefore not classified as defacto.

When you accumulate the most you feel possible, go set up a few trusts and shelf companies.
at this point get a prenup, saying she will not touch your property, company or trusts, or any of the trusts or companys assets or future assets.

Then start buying in the co and trust.

happy days.

 

[xcesiv]

She has no assets. She has a car that has a lean against it to the value of the car, I will be just shy of the $1Mill Mark in assets by the end of the year.

She doesnt understand about Property at all, and doesnt understand how much i have.

I am looking to buy a house for my PPOR by the end of the year, and she cant understand why i wont sell 1 of the IPs to buy a nice place for myself rather than settle for something a little cheaper and keep the IPs i have.

She just thinks im all about the $$$.

Marrage is something on the cards but not for a while, but it is something i should be gearing up for.

and your right. Its a very touchy subject and i would rather have the talk now 1 on 1 rather than having to bring lawyers into it and have to fight for all the hard work i have put into it.

If we neevr break up we both share in the wealth, if she leaves then she leaves with wat she started with.

 

[Perp]

OK. You are old fashioned .

I can live with that.

I don't disagree with your stance, but statistics just don't support the idea that people enter marriage "boots and all". And even if one party does, who knows what is really in the head of the other party.

I think the statistics suggest that people don't enter marriage "boots and all", and that's precisely my point. I think there'd be far fewer divorces if they did.

You're right that you can't know what's in the head of the other party, but there are clues, and finding out what the other person's attitude is towards the commitment is what I'm suggesting should be your primary point of due diligence.

 

[wylie]

I think the statistics suggest that people don't enter marriage "boots and all", and that's precisely my point. I think there'd be far fewer divorces if they did.

I think we are saying the same thing .

 

[Sheryn]

She has no assets.
She doesnt understand about Property at all, and doesn't understand how much i have.

Xcesiv
I discussed with our Lawyer personal financial binding agreements for our daughter. My understanding is both parties list their assets - you with your laywer and your GF with hers. Cost quoted was only a few hundred dollars each [I think].

Personally, I would have the conversation with GF using the line that you have a lot of debt and if you are to live together then for her benefit you need a personal financial binding agreement so she is not responsible for any of your debt!!

She is responsible for her debt & you are responsible for your debt!!

Of course our daughter did not wish to do PFBA! Our son is more switched on wealth creation wise and would do a PFBA.


Good luck
Sheryn

 

[coastymike]

Unfortunately many things can happen which affect things. You can start a relationship fully committed at the beginning and four years later the hard work is too much and one party wants to bail, mental illness can creep in and the brain does strange things to that person and they bail, gambling can take hold of a person, etc etc.

The concept of life long commitment is becoming a thing of the past and you need to plan accordingly. Ive seen wonderful couples from religious backgrounds (just using this as an example because a lot of religions talk about marriage before living together) and years later both seperate. Their faith is just as strong but things didnt work out. This is life.

Being on the other side is a lot more unpleasant at times than facing these issues before you marry or live together.

If you do go forward without anything you need to accept the fact later on that this was your decision and if things do turn nasty then you had the opportunity to mitigate it. Why not do it while the hormones are all positive and love can conquer all. Funny how when oxytocin, dopamine, serotonin and all those other wonderful love chemicals change that other things change with them. Be on the right side of the chemicals.

 

[xcesiv]

I want to make sure i am covered.

I like the way Sheryn put it.

You have your debts, and I have mine. you look after yours and i will look after mine.

i cant see her helping me pay mine anyway. I make alot more money than she does.

Hopefully just the throught of my loan repayments would scare her off trying anything, not thinking about the income and Capital growth the properties have had in the past and coming future.

I have seen a mate go through it and i dont want to fall into that painfull spot where i have to sell up to get rid of her if it came to that.

Does anyone have a someone they would recommend seeing to discuss this further.

Warren

 

[Propertunity]

Does anyone have a someone they would recommend seeing to discuss this further.

Yes, how about John and Lorena Bobbitt? seriously

 

[Dazz]

You have your debts, and I have mine. you look after yours and i will look after mine.

Warren

I may be living in a parallel universe Warren, but I suspect the modern girl of today....inundated with everything that opens and shuts, is up to the second with the latest in everything, and chats with her female friends every 20 seconds on every subject.....isn't that naive as to be in total isolation and fall for that lame smokey mirror trick.


When females get into relationship troubles, it takes about 2 days tops for her to have a chat with her friendly female family law practitioner.


That is the very moment Warren, you get the "Dear Sir, My client insists....." letter.


This topic falls deliciously right smack bang in the middle of that swirling emotive arena where money meets feelings, and 10,000 opinions reign supreme and there isn't a solid fact to grasp onto in sight. Oh, but what lively conversations it will endear.

 

[xcesiv]

I dont think there is any really nice way to bring up a Pre Nup of any kind unless she was to bring it up with me.

I know that there is no chance of me giving her anything to sign without her telling all her friends and then they all hate me for it. But if that ended it then we know where i stood.

Has anyone here gone through this before. How did you ask your partner to sign a pre nup/

 

[Sheryn]

Money ain't everything but it sure helps...

I dont think there is any really nice way to bring up a Pre Nup of any kind unless she was to bring it up with me.

Xcesiv - don't use the word Pre Nup!!! As the wrong message will be delivered.

Dear GF
I have a few large debts that I am personally responsible for and I would like to protect you. I believe I have my debts under control but you never know what the future holds.

Xcesiv - Obviously you want the GF to move in with you?

When our daughter refused to discuss PFBA with her boyfriend we said fine, OK we have discussed this with you and you have chosen not to go down PFBA path. We are OK with this.

Money is a tool and your intelligence allows you to use it in different ways.

We are not overly concerned about daughter not going down PFBA path as she is happy and has a boyfriend.

There are a lot of lonely people in the world without boyfriends/girlfriends!

If GF took you for half - do you have the intelligence and drive to replace $, obviously you would be a few years behind the $ goal, but you have had a GF.

 

[Leikela]

There are a lot of lonely people in the world without boyfriends/girlfriends![/B]

If GF took you for half - do you have the intelligence and drive to replace $, obviously you would be a few years behind the $ goal, but you have had a GF.

I'd rather be single than give a man half my assets!

I don't think single necessarily means lonely, my single girlfriends always seem to be a lot happier than my married ones, and they certainly have less to complain about!

 

[coastymike]

xcesiv

Dont usually share too much personal info but yes I did go through this and our relationship ended as a result of the discussions. the issue is that the other party has to get independent legal advice and it is at that point that all the pros and cons are given.

As TPFKAD said then they go and talk to their cousins, mothers, best friends and every other female friend and before you know it you are worse than Adolf Hitler. Such an uncaring, evil, greedy man. I thought you loved me she will say.

Anyway upshoot is that things didnt work out and we went our seperate ways. Now I am back in a relationship but only casual and have made it clear from the beginning what I am looking for and what I am not. Given she is 15 years younger than me means she couldnt care less.

sheryn there are also a hell of a lot of lonely people with husband, wives, boyfriends and girlfriends. having one or not having one doesnt make you happy. if you like yourself then be happy.

Anyway enjoy the conversation. They are difficult to have but that is life. Then you will truly see how she will react to something that is very important. As they say lots more fish in the sea and the older one gets the more you realise that life can sometimes just be about fun. As Dale always said have fun. I have to agree.